Feasibility Studies Outline

FEASIBILITY STUDIES OUTLINE LETTER OF TRANSMITTAL PROJECT OVERVIEW Name of the Enterprise Products or Services (Main-line, Primary) Allied Products and Services Location (Main office address) Location (other operations like plants, branches / outlets, warehouse, etc.) Descriptive Definition of the Project (summary only; 1 or 2 short paragraphs) Long-term Objectives EXECUTIVE SUMMARY (Paragraph form; 1 to 3 pages long)  Tell reader what the whole paper is about in one glance  Include important parts, features, facts  Conclusion, recommendation TABLE OF CONTENTS (with page numbers) I. INTRODUCTION A. Name of Enterprise (what is the name, why was the name chosen) B. Trademark (other trade name, logos, symbols, slogans) C. Products and Services a. Primary products / services b. Allied products / services c. List brand-names, range of products, description, etc. D. Location a. Main Office (registered business address;) b. Other offices, branches, outlets, etc. c. Other operations such as warehouses, commissary, etc. *justify and discuss how each location was chosen; show maps; E. Descriptive Definition of the Project a. Business Concept b. Technology Concept (discuss, introduce, application, advantages / disadvantages) c. Why is it feasible (or assumed to be), what led to this study F. Long-term Objectives G. Mission / Vision Statement H. Highlights of the Project a. Main features b. Unique, differentiating features I. Success Factors (cite both internal and external

factors) J. Feasibility Criteria (pre-set conditions or criteria with specified minimum or maximum acceptable values to judge feasibility of the project) K. Major Assumptions (all significant assumptions where you anchored your computation and analysis on; certain rates, trends, expected continuing pattern or behavior, etc.) L. Summary Findings (List all significant findings in each part of your paper) M. Conclusion II. ENVIRONMENTAL ANALYSIS A. Economic Factors B. Technological Factors C. Governmental-Political-Legal Factors D. Socio-Cultural-Societal Factors *Scan Environment, Identify significant factors, discuss, analyze impact and give recommendation. Always look for both positive and negative factors. III. INDUSTRY ANALYSIS A. Industry Overview (Global and/or Local) • Include industry composition, capacity, supply and utilization (remember the value chain of the industry) B. Philippine Competitiveness (if Global) C. Porter’s 5 Forces of Competition a. Competition • Include market segment, market thrust and focus, features, strengths, other comparison; analyze intensity of competition. b. Threat of New Entrants (analyze level of threat and barriers to entry) c. Threat of Substitutes (analyze level of threat) d. Suppliers (analyze supplier bargaining power and leverage) e. Consumers(analyze consumer bargaining power and leverage) IV. MARKET STUDY A. Research Design and Methodology a. Determining the Right Method b. Method of Projection B. Product Description (describe your product so as to be able to compare with competing products and substitutes) C. Demand D. Supply E. Demand-Supply Analysis F. Price Study (your competitors’ pricing; show

price range and price elasticity) G. Market Program (currently being used in the market) V. TECHNICAL STUDY A. MANUFACTURING / SERVICE PROCESSES a. System Flowchart b. Program Flowchart c. Plant Size, capacity and Production Schedule (cite minimum & maximum) B. EQUIPMENT & FACILITIES d. Machinery and Equipment e. Plant Location f. Plant Layout (with measurement) g. Building and Facilities (list all renovations and construction to be done, show illustration) C. OPERATIONS / PRODUCTION h. Raw Materials and Supplies (cite initial inventory, monthly or daily consumption and maintaining inventory;) i. Utilities (separate fixed cost and variable cost; be realistic) j. Other consumables (like lubricants, etc.) k. Maintenance l. Waste Disposal (how and how much it will cost; also other alternative disposal plan) m. Labor Requirements (include shifting if applicable) n. Quality Control o. Other forms of Control VI. MANAGEMENT STUDY A. ORGANIZATIONAL PLAN 1. Form of Ownership 2. Organizational Structure & Design 3. Organizational Chart 4. Officers and Key Personnel B. STRATEGIES AND PROGRAMS 1. Strategic-Corporate 2. Sales & Marketing 3. Human Resource 4. Technology / I.T. 5. Finance & Admin 6. Operations C. STRATEGY EVALUATION AND CONTROL 1. Strategic-Corporate 2. Sales & Marketing 3. Human Resource 4. Technology / I.T. 5. Finance & Admin 6. Operations

D. OTHER STRATEGIES 1. Contingency Plans (preparation for

emergencies or breakdown) 2. Alternative Plans, Plan-B, Back-Up, FallBack (changes to BM while minimizing cost and utilizing existing assets, skills, etc.) 3. Exit Strategy (How do you get out of the business while minimizing damage. If you’re selling your business or assets, to whom, and justify) VII. FINANCIAL STUDY A. Major Financial Assumptions B. Total Project Cost (Capitalization) a. Include cost on governmental requirements like permits, licenses, etc. b. Include incidental costs like stationeries, receipts, etc. c. Include 6 months operating cost C. Detailed Financial Projections a. Income Statement (5-years) b. Cash Flow i. 5-year projection ii. monthly cash-flow projection for 2-years c. Balance Sheet (5-years) D. Sensitivity Analysis a. Worst-case Scenario b. Most-Likely Scenario c. Best-case Scenario *define significant variables first E. Computation of Profitability Ratios a. Internal Rate of Return (IRR) b. Discounted Rate of Return (DCFRR) c. Return on Investment (ROI) d. Pay-back Period e. Break-even level f. Profitability Ratios / Horizontal Analysis VIII. RISK ASSESSMENT A. Success Factors (Opportunities and Strengths) B. Risk Factors (Threats and weaknesses) C. Analysis and Recommendation APPENDICES • Acknowledgement • Bibliography • Directories (suppliers, resources, etc.) • Spec sheets and cost quotation (this is required as basis for pricing) • Research data and info (cite source and author) • List of figures, tables, graphs and charts (cite source and author) • Survey forms, interview questionnaires, etc. • Glossary